In 2009, senior officials at the Social Security Administration were made aware of grossly underpaying widows who were entitled to much larger benefits.
They did nothing.
So, the “whistleblower”, for lack of a better term, contacted the one person with a large enough megaphone and deep understanding of Social Security to tell him about this absolute disgrace, Larry Kotlikoff.
In 2015, Larry wrote a scorching article for PBS about this issue.
The Social Security Administration did nothing.
But the Social Security Administration Office of the Inspector General (OIG) somehow was made privy to this issue and began an investigation.
In February 2018, the report was released. And this is what they concluded:
“…we estimate SSA underpaid about $131.8 million
to 9,224 beneficiaries who were age 70 and older. In addition, we
estimate SSA will underpay an additional 1,899 beneficiaries who
were under age 70 about $9.8 million, annually, beginning in the
year they attain age 70.
We did not find any evidence SSA had informed claimants of the
option to delay their retirement application when they applied for
benefits, as required. We also found that SSA did not have systems
controls in place to alert its employees when they should inform
widow(er)s of their option to delay their applications for retirement benefits.”
In March 2018, Larry wrote a follow up article about the OIG report. (Links can be found for all sources below.)
The Social Security Administration has been made aware of its negligence when dealing with Widows for nearly a decade.
Yet nothing has been done. Maybe now something will change? I am not holding my breath.
But remember folks, this is not the SSA’s money. This is money that should have gone to some of the most vulnerable Americans, Widows and Widowers.
Many widows are living close to being paupers. Yet could they have been given more money with just some correct planning? Yup. But they relied on their government to steer them right.
And once again, their government let them down. This is disgusting. What if that were YOUR WIFE! Your MOM! Your sister!
Yet, what is Social Security going to do about it? Well back in 2015 they said:
“RESPONSE TO ASSISTANCE REQUEST
DATE OF RESPONSE: 11/10/15
TEXT: PER MANAGEMENT, WE ARE NOT CONTACTING CLAIMANT TO CHANGE SCOPE OF APPLICATIONS.”
I.e., “too bad so sad”.
Thankfully, Larry Kotlikoff is on the case. Unfortunately, he is a one-man Army it seems.
Fighting the good fight for ALL beneficiaries to get what is their legal rights. Yeah, Larry understands Social Security is one of the big three, the unfunded liabilities that at some point will bankrupt this country.
But a person still has a legal right to get what they are legally entitled to regardless of the solvency of the system.
Worried about the system’s long term solvency? Fine. Change the law. But you can’t change the rules after the game has been played for these widows. And essentially that is what is going on here.
So, when it comes to Social Security, my friends, PLEASE for the love of all that is good, understand what the rules are and how those rules affect you. Please.
Do not rely on the good folks at the SSA. They can not plan for you. They can not tell you what your best options are. They can only tell you what your plan of action is maximize benefits today. That’s it.
And unfortunately because of that, they’ve cost millions upon millions of dollars to beneficiaries.
It’s wrong on so many levels.
Larry’s 2015 article.
Larry’s 2018 article.
OIG Report 2018.